Airline Services & Logistics Plc RC:304508
Unaudited Nine Months Condensed Group IFRS Report
For the third quarter ended 30 September 2013
Airline Services & Logistics Plc RC:304508 Unaudited Nine Months Condensed IFRS Report For the third quarter ended 30 September 2013
Corporate InformationBOARD OF DIRECTORS
Chairman Dr.Patrick Dele Cole
Managing Director / Chief Executive Officer Mr. Richard T. Akerele
Non Executive Directors Otunba Solomon K. Onafowokan OON
Ms. Jumoke Ogundare
Mr. Mohammed Sadiq
Mr. Alfred Rigler ( German)
PROFESSIONAL ADVISERS
Company Secretary & Legal Adviser LPC Solicitors
Stonehouse, 9, Oyo Close
Off Niger Street
Parkview Estate, Ikoyi
Lagos
Registrar Meristem Registrars Limited
213, Herbert Macaulay Way
Adekunle-Yaba
Lagos
Auditors Akintola Williams Deloitte
(West & Central Africa)
Chartered Accountants
235, Ikorodu Road
P.O. Box 965, Marina
Lagos
Bankers Access Bank Plc
Ecobank Nigeria Plc
Guaranty Trust Bank Plc
Stanbic IBTC Bank Plc
REGISTERED OFFICE
1, Service Street
P.O. Box 4953, Murtala Muhammed International Airport
Ikeja
Lagos
WEBSITE
www.aslafrica.com
AIRLINE SERVICES AND LOGISTICS PLC.
RC.304,508
Unaudited Nine Months Condensed IFRS Report For the third quarter ended 30 September 2013
C O N T E N T S
Corporate Information
Financial Highlights
Statement of Financial Position
Statement of Comprehensive Income
Statement of Cashflows
Statement of Changes in Equity
Notes to the Financial Statements
Accounting Policies and Operational status
Operating Segment Information
Notes
AIRLINE SERVICES AND LOGISTICS PLC.
RC:304508
GROUP FINANCIAL HIGHLIGHTS
STATEMENT TO THE NIGERIAN STOCK EXCHANGE AND SHAREHOLDERS ON THE UNAUDITED 9 MONTHS IFRS RESULTS AS AT SEPTEMBER 30, 2013
The Board of Directors hereby announces the unaudited nine months result of the group for the third quarter ended 30 September 2013 with the
comparative figures for the corresponding period of the previous year in compliance with the directives of the Financial Reporting Council of Nigeria
Nine Months ended
September 30
Nine Months ended
September 30
2013 2012 Absolute
Changes
N'000 N'000 %
Revenue 2,658,802 2,960,735 -10.20
Other Income 200,061 195,402 2.38
Finance Income 13,102 20,623 -36.47
Profit before Taxation 79,295 455,901 -82.61
Profit after Taxation 79,295 455,901 -82.61
Finance Cost 12,139 24,961 -51.37
Revenue Reserves 1,489,099 1,489,249 -0.01
Investment Revaluation Reserve 1,440 1,329 8.39
Share Capital 317,000 317,000 0.00
Share Premium 342,000 342,000 0.00
Shareholders' Funds 2,106,952 2,149,578 -1.98
Market Capitalisation as at September 30 2,681,820 1,375,780 94.93
Information per 50kobo ordinary share
* Earnings per share 0.13 0.72 -82.61
Stock Exchange Quotation ( Naira as at 30 September) 4.23 2.17 94.93
Total Issued Shares 634,000 634,000 0.00
*Earnings= Profit after Tax
AIRLINE SERVICES AND LOGISTICS PLC.
RC:304508Condensed Consolidated Statement of Profit and Loss and Other Comprehensive Income
For the third quarter ended 30 September, 2013
9 months ended 9 months ended 12 months audited
30-Sep-13 30-Sep-12 31-Dec-12Note N'000 N'000 N'000
Revenue 6 2,658,802 2,960,735 3,831,788
Cost of sales 995,688 1,114,880 1,462,993
Gross profit 1,663,114 1,845,856 2,368,795
Administrative expenses 1,784,843 1,581,020 2,170,403
Other operating income 8 173,861 159,250 257,711
Operating profit 52,133 424,086 456,103
Finance income 7 13,102 20,623 31,417
Other gains and losses 8 26,199 36,152 35,736
Finance costs (12,139) -24,961 (30,456)
Profit before Income tax 9 79,295 455,901 492,800
Income Tax Expense 10 (390)
Profit for the period 79,295 455,901 492,410
Other Comprehensive income 73 153 191
Total Comprehensive income 79,369 456,054 492,601
Profit for the period attributable to:
Owners of the Company 121,883
Non-controlling interests (42,588)
79,295 - -
Total Comprehensive income for the period attributable to:
Owners of the Company 121,957
Non-controlling interests (42,588)
79,369 - -
Basic and diluted 11 0.19 0.72 0.78 Earnings per share
Airline Services and Logistics Plc
Condensed Consolidated Statement of Cash flows
For the third quarter ended 30 September, 2013
30-Sep-13 30-Sep-12
Note N'000 N'000
Cash flows from operating activities
Cash receipts from customers 3,000,198 3,085,470
Cash payments to suppliers,employees and govt taxes -2,776,426 (2,351,706)
14 223,772 733,763
12 -322,873 (46,029)
Proceeds from sale of Property, plant and equipment 1,630
13,102 20,623
-308,141 (25,405)
-12,139 (24,961)
-158,500 (126,800)
530,400
-65,000 (126,189)
294,761 (277,950)
210,392 430,408
624,632 300,026
835,024 730,434 Cash and cash equivalents at the end of the period
Net cash used in investing activities
Cash flows from Financing Activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the
Loan received
Loans repaid
Net cash generated from operating activities
Interest paid
Dividend paid
Net cash used in financing activities
Cash flows Investing activities
Purchase of Property, plant and equipment
Interest received
Airline Services and Logistics Plc
Condensed Consolidated Statement of Financial Position
As at 30th September 2013
30-Sep-13 31-Dec-12
Note N'000 N'000
Assets
32,078 33,320
12a 1,172,398 1,021,310
2,856 2,783
13,507 8,510
1,220,840 1,065,923
207,997 186,050
708,315 863,777
235,712 249,332
835,024 624,632
1,987,047 1,923,791
3,207,887 2,989,714
317,000 317,000
342,000 342,000
Retained Earnings 1,489,099 1,525,716
1,440 1,367
Non - Controlling Interests (42,588) 2,106,951 2,186,083
Liabilities
Borrowings 530,400
8 8
530,408 8
Current Liabilities
14,881 72,362
555,626 665,499
21 389
65,373
570,528 803,623
Total liabilities 1,100,936 803,631
Total equity and liabilities 3,207,887 2,989,714
on its behalf by:
………………………………………………………….
Company Secretary
Deferred tax liabilities
Borrowings
Liability for retirement benefit
Current tax liabilities
The financial statements were approved by the board of directors and authorised for issue on December 12,
2013 and signed
Trade and other payables
Non-current assets
Share capital
Inventories
Trade and other receivables
Cash and bank balance
Equity and Liabilities
Intangible assets
Property, plant and equipment
Financial asset
Other asset
Current assets
Equity attributable to owners
Other asset
Non-current Liabilties
Total assets
Investment Revaluation Reserve
Share premium account
Total equity
Airline Services and Logistics Plc
Condensed Consolidated Statement Of Changes In Equity
for the period ended 30th September, 2013
Share Capital Share Premium
Account
Retained
Earnings
Investment
Revaluation
Reserve
Non -
Controlling
Interests
Total
N'000 N'000 N'000 N'000 N'000 N'000
317,000 342,000 1,525,716 1,367 2,186,083
121,883 (42,588) 79,295
73 73
317,000 342,000 1,647,599 1,440 (42,588) 2,265,452
(158,500) (158,500)
Balance as at 30 September 2013 317,000 342,000 1,489,099 1,440 (42,588) 2,106,952
317,000 342,000 1,160,148 1,176 1,820,324
455,901 455,901
153 153
317,000 342,000 1,616,049 1,329 2,276,378
(126,800) -126,800
Balance as at 30 September 2012 317,000 342,000 1,489,249 1,329 2,149,578
Dividends Declared
Balance at 1 January 2013
Profit for the period
Total comprehensive income for the period
Equity attributable to equity holders of the Group
Period ended 30 September 2013
Other comprehensive income (net of tax)
Total comprehensive income for the period
Period ended 30 September 2012
Other comprehensive income (net of tax)
Dividends Declared
Balance at 1 January 2012
Profit for the period
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
2.1 General information
2.2 Composition of financial statement
•Condensed Consolidated Statement of profit or loss and other comprehensive income
•Condensed Consolidated Statement of Financial Position
•Condensed Consolidated Statement of Changes in Equity
•Condensed Consolidated Statement of Cashflows
• Notes to the Condensed Consolidated Financial Statements.
2.3 Basis of Accounting
2.4 Basis of Consolidation
2.5 Financial period
These Consolidated Financial Statements cover the financial period from 1st January to 30th September 2013
and where appropriate, from 1st January to 31st December 2012.
Airline Services and Logistics plc was incorporated as a private limited liabilty Company on December 6,
1996. It became a public limited Liability company on February 26, 2007 and its shares were listed pn the
floors of the Nigerian Stock Exchange on July 25, 2007. The address of the registered office is 1, Service
Street, Murtala Muhammed International Airport, Ikeja Lagos, Nigeria. The principal activities of the
Company are the provision of catering and related services to international airlines within the Nigerian aviation
industry. The company operates international standard in-flight catering facilities and VIP lounges at the
Murtala Muhammed International Airport, Lagos (MMIA) and the Nnamdi Azikwe International Airport, Abuja.
The Company in partnership with RwandaAir has obtained a licence to provide in-flight catering and ancillary
services at the Kigali International Airport, Rwanda. In addition, the Company is also currently prospecting for
catering services in the Oil and Gas sector of the Nigeria's economy. The Company's fully owned subsidiary ;
Reacon duty free Limited operates duty free outlets at the MMIA.
The Condensed Consolidated Financial statements are drawn up in naira, the functional currency of Airline
Services and Logistics Plc. In accordance with IFRS accounting presentation,the Condensed Consolidated
Financial Statements comprise:
The Group Financial Statements have been prepared in accordance with International Financial Reporting
Standards ("IFRSs"), which comprise standards and interpretations issued by either the International
Accounting Standards Board ("IASB") or the International Financial Reporting Interpretations Committee
("IFRIC"). The Group Financial Statements have been prepared under the historical cost convention, except
for the measurement at fair value of certain classes of assets. The Group Financial Statements have been
prepared on a going concern basis.
The Consolidated financial statements incorporate the financial statements of the Company and entities
controlled by the Company (its subsidiary) made up to 31 December each year. Control is achieved where the
Company has the power to govern the financial and operating policies of an investee entity so as to obtain
benefits from its activities.
The results of a subsidiary acquired or disposed of during the year are included in the consolidated income
statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where
necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies
used into line with those used by the group. All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
3.1 Adoption of new and revised Standards
The following amendments were made as part of Improvements to IFRSs .
IFRS 7: FINANCIAL INSTRUMENT: DISCLOSURES
IFRS 10 CONSOLIDATED FINANCIAL STATEMENTS
IFRS 10 is applicable to annual reporting periods beginning on or after 1 January 2013
IAS 1: PRESENTATION OF FINANCIAL STATEMENTS
IAS 12: INCOME TAXES
IFRS 9 FINANCIAL INSTRUMENTS
IFRS 9 introduces new requirements for classifying and measuring financial assets.
IFRS 12 DISCLOSURE OF INTERESTS IN OTHER ENTITIES
IFRS 1: FIRST TIME ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS
The standard now includes additional exemption for entities ceasing to suffer from severe hyperinflation and
the replacement of 'fixed dates' for certain exceptions with 'the date of transition to IFRSs'. Effective for annual
periods beginning on or after 1 July 2011.
The standard now contains amendments enhancing disclosures about transfers of financial assets, it was
issued in October 2010 and will be effective for annual periods beginning on or after 1 July 2011
Retrospective application is generally required in accordance with IAS 8 Accounting Policies, Changes in
Accounting Estimates and Errors. However, an entity is not required to make adjustments to its accounting for
its involvement with entities that were previously consolidated and continue to be consolidated, or entities that
were previously unconsolidated and continue not to be consolidated.
An amendment was issued to revise the way other comprehensive income is presented in June 2011, this will
take effect for annual periods beginning on or after July 2012.
Limited scope amendment was made (that is recovery of underlying assets). It was amended in December
2010 and will be effective for periods beginning from January 2012
At the IASB's July 2011 meeting, the IASB decided to postpone the mandatory application of IFRS 9 to annual
periods beginning on or after 1 January 2013 with early application still permitted
The objective of IFRS 12 is to require the disclosure of information that enables users of financial statements to
evaluate the nature of, and risks associated with, its interests in other entities the effects of those interests on
its financial position, financial performance and cash flows. IFRS 12 is applicable to annual reporting periods
beginning on or after 1 January 2013. Early application is permitted.
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
3.2 Standards not affecting the reported results nor the financial position
IFRS 9 FINANCIAL INSTRUMENTS
IFRS 9 introduces new requirements for classifying and measuring financial assets.
IFRS 12 DISCLOSURE OF INTERESTS IN OTHER ENTITIES
IFRS 11 JOINT ARRANGEMENTS
IFRS 13 FAIR VALUE MEASUREMENT
The following new and revised Standards and Interpretations have been adopted in the current year. Their adoption has not
had any significant impact on the amounts reported in these financial statements but may impact the accounting for future
transactions and arrangements.
At the IASB's July 2011 meeting, the IASB decided to postpone the mandatory application of IFRS 9 to annual periods
beginning on or after 1 January 2013 with early application still permitted
The objective of IFRS 12 is to require the disclosure of information that enables users of financial statements to evaluate the
nature of, and risks associated with, its interests in other entities the effects of those interests on its financial position,
financial performance and cash flows. IFRS 12 is applicable to annual reporting periods beginning on or after 1 January
2013. Early application is permitted.
A joint arrangement is an arrangement of which two or more parties have joint control. IFRS 11 is applicable to annual
reporting periods beginning on or after 1 January 2013
IFRS 13 applies when another IFRS requires or permits fair value measurements or disclosures about fair value
measurements (and measurements, such as fair value less costs to sell, based on fair value or disclosures about those
measurements), IFRS 13 is applicable to annual reporting periods beginning on or after 1 January 2013. An entity may
apply IFRS 13 to an earlier accounting period, but if doing so it must disclose the fact.
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
4 Summary of significant accounting policies
4.1 Going concern
4.2 Business combinations
If the initial accounting for a business combination is incomplete by the end of the reporting period in
which the combination occurs, the Group reports provisional amounts for the items for which the
accounting is incomplete. Those provisional amounts are adjusted during the measurement period
(see below), or additional assets or liabilities are recognised, to reflect new information obtained
about facts and circumstances that existed as of the acquisition date that, if known, would have
affected the amounts recognised as of that date.
The measurement period is the period from the date of acquisition to the date the Group obtains
complete information about facts and circumstances that existed as of the acquisition date, and is
subject to a maximum of one year.
The directors have, at the time of approving the financial statements, a reasonable expectation that
the Company and the Group have adequate resources to continue in operational existence for the
foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing
the financial statements.
Acquisitions of subsidiaries are accounted for using the acquisition method. The consideration for
each acquisition is measured at the aggregate of the fair values (at the date of exchange) of assets
given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for
control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.
Where a business combination is achieved in stages, the Group’s previously-held interests in the
acquired entity are re-measured to fair value at the acquisition date (i.e. the date the Group attains
control) and the resulting gain or loss, if any, is recognised in profit or loss. Amounts arising from
interests in the acquiree prior to the acquisition date that have previously been recognised in other
comprehensive income are reclassified to profit or loss, where such treatment would be appropriate if
that interest were disposed of.
The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for
recognition under IFRS 3(2008) are recognised at their fair value at the acquisition date, except that:
deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are
recognised and measured in accordance with IAS 12 Income Taxes and IAS 19 Employee Benefits
respectively;
Assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current
Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard.
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
Summary of significant accounting policies (continued)
4.3 Noncurrent asset held for sale
4.4 Revenue recognition
4.5 Deferred income
4.6 Inventories
Non-current assets (disposal groups comprising assets and liabilities) that are expected to be
recovered primarily through sale rather than through continuing use are classified as held for sale.
Non-current assets held for sale and discontinued operations are carried at the lower of carrying
amount or fair value less costs to sell. Depreciation is not charged on assets that have been
classified as held for sale. A discontinued operation is a component of an entity that either has been
disposed of, or that is classified as held for sale, and (a) represents a separate major line of business
or geographical area of operations; and (b) is a part of a single coordinated plan to dispose of a
separate major line of business or geographical area of operations; or (c) is a subsidiary acquired
exclusively with a view to resale. Any gain or loss from disposal of a business, together with the
results of these operations until the date of disposal, is reported separately as discontinued
operations.
All revenues derived from the selling of products or rendering of services are recognised as revenue.
Other operational revenues are recognized as other operating income. Sales are recognized in the
statement of profit or loss and other income when the significant risks and rewards of ownership of
the goods have been transferred to the customer, the Group retains neither continuing managerial
involvement to the degree usually associated with ownership nor effective control over the goods
sold, the amount of revenue and costs incurred or to be incurred can be measured reliably, and it is
sufficiently probable that the economic benefits associated with the transaction will flow to the
company.
Sales are stated net of discounts allowed and sales reductions at fair value. Sales deductions are
estimated amounts for rebates, cash discounts and product returns. They are deducted at the time
the sales are recognized, and appropriate provisions are recorded. Sales deductions are estimated
primarily on the basis of historical experience, specific contractual terms and future expectations of
sales development. It is unlikely that factors other than these could materially affect sales deductions
in the Group.
Deferred income represents the part of the amount invoiced to customers that has not yet met the
criteria for revenue recognition and thus still has to be earned as revenues by means of the delivery
of goods and services in the future. Deferred income is recognized at its nominal value.
In accordance with IAS 2 (Inventories), inventories encompass assets held for sale in the ordinary
course of business (finished goods and goods purchased for resale), in the process of production for
such sale (work in process) or in the form of materials or supplies to be consumed in the production
process or in the rendering of services (raw materials and supplies). Inventories are stated at the
lower of cost and net realizable value of first in first out (FIFO) basis after making specific provisions
for obsolete and damaged stocks. The net realizable value is the achievable sale proceeds under
normal business conditions less estimated cost to complete and selling expenses.
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
Summary of significant accounting policies (continued)
4.7 Provisions for pensions and other post-employment benefits
4.8 Taxation
Current tax
The company operates a defined contributory staff pension scheme for members of staff which is managed by
Pension fund administrators. The scheme, which is funded by contributions from employees (7.5%) and the Group
(7.5%) of basic salary, housing and transport allowances, is consistent with the provisions of the Pension Reform
Act, 2004.
The company has a new exit scheme which came into force in August 2009 when the old gratuity scheme was
discontinued. Under the new scheme, the Company contributes 6% of the gross salary of all the staff on monthly
basis. The exit scheme amount is funded through a dedicated bank account in which a representative of the
employees is a signatory.
The Company conducts its business in the Export processing zone and in line with section 8 of the NEPZA Act No
63 of 1992 as amended, the company is exempt from all Federal, State and Local Government taxes, levies and
rates. Similarly section 18 (a) and (e) exempt the Company from taxes and allows the Company to sell up to 25
percent of its production in the local market and subject to the issuance of the relevant permit. The company would
be liable to tax on income generated outside the zone if the scope of business outside the zone is expanded
beyond the 25 percent of its production. The company for now is not operating outside the Zone and therefore no
income tax is applicable thereof.
The subsidiary that is included in the consolidated financialstatement is subject to taxation. Below is the accounting
policy applied:
Income tax expense represents the sum of the tax currently payable and deferred tax.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the
manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of
its assets and liabilities.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from ‘profit before tax’ as reported in the
consolidated statement of profit or loss and other comprehensive income because of items of income or expense that are
taxable or deductible in other years and items that are never taxable or deductible. The Group's liability for current tax is
calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the
consolidated financial statements and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are
generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will
be available against which those deductible temporary differences can be utilised. Such deferred tax assets and
liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other
than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit
nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries
and associates, and interests in joint ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred tax assets arising from deductible temporary differences associated with such investments and interests
are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise
the benefits of the temporary differences and they are expected to reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the
extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which
the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period.
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
4.9 Property, plant and Equipment
Range of
Years Freehold buildings 20
Leasehold buildings Over the lease period
Office equipment and furniture and fittings 4 - 10 years
Computer & Accessories 4 years
Household furniture and fittings 4 - 10 years
Motor vehicles 2 - 5 years
Plant and Equipment 3 - 7 years
Lounge & Cockpit Bar Improvement 5 years
Software Licences 3 years
4.1 Segment reporting
4.11 Interest-bearing debt
Financial liabilities, such as bond loans and other loans from credit institutions are recognized initially
at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing debt
is stated at amortized cost with any difference between cost and redemption value being recognized in
the statement of profit or loss and other comprehensive income over the period of the borrowings on
an effective interest basis.
All property, plant and equipment is shown at cost, less subsequent depreciation and impairment. Cost
includes expenditure that is directly attributable to the acquisition of the assets. Subsequent costs are
included in an asset's carrying amount or recognised as a separate asset, as appropriate, only when it
is probable that future economic benefits associated with the item will flow to the Group and the cost of
the item can be measured reliably. All other repair and maintenance expenditures are charged to the
Income Statement during the financial period in which they are incurred.
Depreciation is calculated using the straight-line method to reduce the cost of each asset to its residual
value over its useful life as follows:
Major renovations are depreciated over the remaining useful life of the related asset or to the date of
the next major renovation, whichever is sooner.
The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each
reporting date. An asset's carrying amount is written down immediately to its recoverable amount if the
asset's carrying amount is greater than its recoverable amount.
Gains and losses on disposals are determined by comparing the disposal proceeds with the carrying
amount and are included in the Group statement of profit or loss and other comprehensive income.
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker. The chief operating decision maker, who is responsible for allocating
resources and assessing performance of the operating segments, has been identified as the chief
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
Summary of significant accounting policies (continued)
4.12 Trade receivables
4.13 Trade payables
Trade and other payables are stated at cost.
4.14 Financial Instruments
The Group’s other financial instruments include:
- Cash and cash equivalents
- Fixed Deposits
- Borrowings
Cash and cash equivalents
Fixed deposits
Borrowings
4.15 Foreign currency transactions and translation
Functional and presentation currency- Items included in the financial statements of each of the
Group’s entities are measured using the currency of the primary economic environment in which the
entity operates (the functional currency). The consolidated financial statements are presented in naira,
which is the Group’s functional and presentation currency.
Trade receivables are carried at original invoice amount less any allowance for doubtful debts.
Provisions are made where there is evidence of a risk of non-payment, taking into account ageing,
previous experience and general economic conditions. When a trade receivable is determined to be
uncollectable it is written off, firstly against any allowance available and then to the statement of profit
or loss and other comprehensive income. Subsequent recoveries of amounts previously provided for
are credited to the statement of profit or loss and other comprehensive income. Long-term receivables
are discounted where the effect is material.
Cash and cash equivalents comprise cash in hand, current balances with banks and similar
institutions and highly liquid investments with maturities of three months or less when acquired. They
are readily convertible into known amounts of cash and are held at amortised cost.
Fixed deposits, comprising principally funds held with banks and other financial institutions, are initially
measured at fair value, plus direct transaction costs, and are subsequently remeasured to amortised
cost using the effective interest rate method at each reporting date. Changes in carrying value are
recognised in profit.
All borrowings are initially recorded at the amount of proceeds received, net of transaction costs.
Borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net
of transaction costs, and the amount due on redemption being recognised as a charge to profit or loss
over the period of the relevant borrowing.
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets,
which are assets that necessarily take a substantial period of time to get ready for their intended use
or sale, are added to the cost of those assets, until such time as the assets are substantially ready for
their intended use or sale. All other borrowing costs are recognised in profit or loss in the period in
which they are incurred
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
Summary of significant accounting policies (continued)
Foreign currency transactions and balances
4.16 Provisions
4.17 Earnings per share
4.18 Impairment of tangible and intangible assets excluding goodwill
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value
in use, the estimated future cash flows are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value of money and the risks specific to the
asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying
amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable
amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is
carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year-end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognized in the statement of profit or
losss and other comprehensive income.
Non-monetary assets and liabilities in a foreign currency that are measured in terms of historical cost
are translated using the exchange rate at the transaction date.
Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are
translated to the functional currency at foreign exchange rates prevailing at the dates the fair value
was determined.
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result
of a past event, it is probable that the Group will be required to settle that obligation and a reliable
estimate can be made of the amount of the obligation.
The Group presents basic and diluted earnings per share data for its ordinary shares. Basic earnings
per share is calculated by dividing the profit and loss attributable to ordinary shareholders of the
Company, by the weighted average number of ordinary shares outstanding during the year. Diluted
earnings per share is determined by adjusting the profit and loss attributable to ordinary shareholders
and the weighted average number of ordinary shares outstanding, for the effects of all dilutive
potential ordinary shares.
At each reporting date, the Group reviews the carrying amounts of its tangible and intangible assets to
determine whether there is any indication that those assets have suffered an impairment loss. If any
such indication exists, the recoverable amount of the asset is estimated to determine the extent of the
impairment loss (if any). Where the asset does not generate cash flows that are independent from
other assets, the group estimates the recoverable amount of the cash-generating unit to which the
asset belongs. An intangible asset with an indefinite useful life is tested for impairment at least
annually and whenever there is an indication that the asset may be impaired.
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
Summary of significant accounting policies (continued)
Impairment of tangible and intangible assets excluding goodwill (continued)
4.19 Dividend distribution
5
5.1
5.2
Critical judgements in applying the Group’s accounting policies
Key sources of estimation uncertainty
Valuation of financial liabilities
Financial liabilities have been measured at amortised cost in line with the guidiance provisions of IAS
39. The effective interest rate used in determining the amortised cost of the individual liabilty
amounts has been estimated using the contractual cashflows on the loans. IAS 39 requires the use
of the expected cashflows but also allows for the use of contractual cashflows in instances where
the expected cashflows cannot be reliably determined. However, the effective interest rate has been
determined to be the rate that effectively discounts all the future contratual cashflows on the loans
including processing, management fees and other fees that are incidental to the different loan
transactions.
The following are the critical judgements, apart from those involving estimations (which are dealt with
separately below), that the directors have made in the process of applying the Group’s accounting
policies and that have the most significant effect on the amounts recognised in financial statements.
Useful life of property, plant and equipment
The Group reviewed the estimated useful lifes of its property, plant and equipment on transition to
IFRS on 1 January, 2011. The estimates were based on professional judgement expressed by the
external valuers appointed to revalue certain assets. Some of the factors considered includes the
current service potential of the assets, potential cost of repairs and maintenance and brand quality
for over the years.
Allowance for credit losses
The Group periodically assesses its trade receivables for probability of credit losses. Management
considers several factors including past credit record, current financial position and credibility of
management, judgement is exercised in determing the allowances made for credit losses.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-
generating unit) is increased to the revised estimate of its recoverable amount, but so that the
increased carrying amount does not exceed the carrying amount that would have been determined
had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A
reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is
carried at a revalued amount, in which case the reversal of the impairment loss is treated as a
revaluation increase.
Dividend distributions to the Company's shareholders are recognised in the Group's financial
Statements in the period in which the dividend is declared and paid or approved by the Company's
shareholders.
Critical accounting judgements and key sources of estimation uncertainty
In the application of the Group’s accounting policies, which are described in note 3, the directors are
required to make judgements, estimates and assumptions about the carrying amounts of assets and
liabilities that are not readily apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period in which the estimate is revised if the revision
affects only that period, or in the period of the revision and future periods if the revision affects both
current and future periods.
Airline Services and Logistics PlcNotes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
6 Revenue
6.1 Segment information
6.1.1
6.1.2
N'000 N'000 N'000
Lagos Inflight Catering 1,859,432 (647,709) 1,211,724
Abuja Inflight Catering 370,191 (164,669) 205,522
Airport Operations Lagos 429,179 (183,310) 245,869
Kigali Inflight Catering
Port-Harcourt Oil and Gas Catering
2,658,802 (995,688) 1,663,114
(1,784,843)
Other Operating Income 173,861
Operating profit 52,133
Finance income 13,102
Other gains and losses 26,199
Finance costs (12,139)
Profit before tax 79,295
Tax
79,295
Segment revenue
N'000 N'000 N'000
Lagos Inflight Catering 2,206,129 (796,216) 1,409,913
Abuja Inflight Catering 354,941 (157,337) 197,605
Airport Operations Lagos 399,665 (161,327) 238,338
2,960,735 (1,114,880) 1,845,856
(1,581,020)
Other Operating Income 159,250
Operating profit 424,086
Finance income 20,623
Other gains and losses 36,152
Finance costs (24,961)
Profit before tax 455,901
Tax
455,901
Lagos Inflight Catering- The segment operations include inflight catering, laundry and handling services.
The Group earns a major part of its revenue from providing catering services to both international and domestic airline
operators in Nigeria.
Products and services from which reportable segments derive their revenues
Information reported to the chief operating decision maker (the CEO) for the purposes of resource allocation and
assessment of segment performance focuses on a number of factors including geographical location and types of
goods or services delivered or provided. The Group's reportable segments under IFRS 8 are therefore as follows:
Profit for the period
Abuja Inflight Catering-The segment operations include inflight catering, lounges and restaurant services provided in
the abuja office.
Airport Operations, Lagos- The segment provides restaurant , lounge, trolley service and duty free shop.
Kigali Inflight Catering- The segment operations include inflight catering, handling and related services .
Port-Harcourt Oil and Gas Catering- The segment operations includes oil and gas catering and related services .
Segment revenue and resultsThe following is an analysis of the Group's revenue and results by reportable segment for the period ended 30 September 2013:
Segment revenue Cost of sales Segment Profit
Central administration costs
The following is an analysis of the Group's revenue and results by reportable segment for the period ended 30 September 2012:
Cost of sales Segment Profit
Central administration costs
Profit for the period
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
Segment information (continued)
6.1.3
6.2 Revenues from major products and services
The Group’s revenues from its major products and services were as follows:
30-Sep-13 30-Sep-12
Revenue from:N'000 N'000
Inflight Catering 1,723,809 1,950,035
Lounges 151,096 105,685
Duty Free shop 98,288 98,310
Beverages 67,299 113,232
Handling 264,474 298,391
Laundry 79,569 65,259
Others 274,268 329,822
Total revenue 2,658,802 2,960,735
6.3 Geographical information
6.4 Information about major customers
30-Sep-13 30-Sep-12
7 Finance Income N'000 N'000
Interest income on fixed deposit and commercial papers with banks 13,102 20,623
8 Other Income
Sale of scraps 3,265 3,178
Branding income 38,604 37,030
Doubtful debt recovered 50,030 119,042
Profit on disposal of property,plant and equipment
Other loss or gains 26,199 36,152
Levies 81,962
Total operating income 200,061 195,402
Included in revenues arising from Lagos operations are revenues of approximately N198.6million (2012:
N267.8million) which arose from sales to the Group's largest customer.
Segment revenue reported above represents revenue generated from external customers. There were no inter-
segment sales in the current year.
The accounting policies of the reportable segments are the same as the Group's accounting policies described
in note 3. Segment profit represents the profit earned by each segment without allocation of central
administration costs, investment revenue, other gains and losses, finance costs and income tax expense. This
is the measure reported to the chief operating decision maker for the purposes of resource allocation and
assessment of segment performance.
Segment assets and liabilities- The CEO does not make use of information on segment assets and segment
liabilities for the purpose of resource allocation and assessment of segment performance
Currently the Group's operations are domiciled in Nigeria (Company's place of incorporation) and Kigali,
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
30-Sep-13 30-Sep-12
9 Revenue reserve N'000 N'000
Balance at 1 January 1,525,716 1,160,148
Net profit for the period 121,883 455,901
Dividend declared and paid (158,500) (126,800)
Balance at 30 September 1,489,099 1,489,249
10 TaxationThe parent company is tax exempt while the subsidiary has used the minimum tax due to the
unrelieved losses brought forward.
11 Earnings per share
Basic Earnings per share
9 months ended 9 months ended
30-Sep-13 30-Sep-12
N'000 N'000
121,883 455,901
121,883 455,901
Number Number
Shares 634,000 634,000
Basic EPS 0.19 0.72
9 months ended 9 months ended
30-Sep-13 30-Sep-12
N'000 N'000
121,883 455,901
Number Number
Shares 634,000 634,000
Diluted EPS 0.19 0.72
There are no share options,potential rights issues, hence diluted earnings per share are the same
Weighted average number of ordinary shares for the purposes of basic earnings per share
In the year under review, a dividend of 20 kobo per ordinary share totaling N158.5m (2012: 126.8m in respect of
2011 financial year) was declared and paid to the shareholders in respect of 2012 financial year.
The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per
share are as follows
Earnings
Profit attributable to owners of the company
Earnings used in the calculation of basic earnings per share
Weighted average number of ordinary shares used in the calculation of diluted earnings per share
The earnings and weighted average number of ordinary shares used in the calculation of diluted earnings per
share are as follows
Diluted Earnings per share
Earnings
Profit attributable to owners of the company
Earnings used in the calculation of diluted earnings per
share
121,883 455,901
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
12a SCHEDULES OF PROPERTY, PLANT & EQUIPMENT
Building Lounge Cockpit Bar Furniture & Motor Food Processing Asset in
Improvement Improvement Equipment Vehicles Equipment Construction TOTAL
Cost / Deemed Cost N'000 N'000 N'000 N'000 N'000 N'000 N'000 N'000
At the beginning of the Year 303,500 209,402 28,109 143,917 145,785 523,246 7,640 1,361,599
Additions 5,949 13,145 129,056 174,723 322,873
Disposals (118) (8,100) (2,340) (10,558)
At September 30, 2013 303,500 209,402 28,109 149,748 150,830 649,962 182,363 1,673,914
Accumulated Depreciation/Impairment
At the beginning of the Year 60,700 44,795 8,739 30,956 36,277 154,184 4,640 340,291
Charged for the Period 22,762 31,521 4,216 13,297 24,422 69,987 166,205
Eliminated on disposals (35) (4,129) (816) (4,980)
At September 30, 2013 83,462 76,316 12,955 44,218 56,570 223,355 4,640 496,876
NET BOOK VALUE
At January 1, 2013 242,800 164,607 19,370 112,961 109,508 369,062 3,000 1,021,308
At September 30, 2013 220,038 133,086 15,154 105,530 94,260 426,607 177,723 1,172,398
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
12b SCHEDULES OF PROPERTY, PLANT & EQUIPMENT
Building Lounge Cockpit Bar Furniture & Motor Food Processing Asset in
Improvement Improvement Equipment Vehicles Equipment Construction TOTAL
Cost / Deemed Cost N'000 N'000 N'000 N'000 N'000 N'000 N'000 N'000
At the beginning of the Year 303,500 205,239 28,109 120,214 73,009 494,003 5,258 1,229,332
Additions 4,163 23,902 72,776 29,467 2,382 132,690
Disposals (157) (224) (381)
Write Off (42)
At December 31, 2012 303,500 209,402 28,109 143,917 145,785 523,246 7,640 1,361,599
Accumulated Depreciation/Impairment
At the beginning of the Year 30,350 3,421 3,117 15,382 17,345 74,596 144,211
Charged for the Period 30,350 41,374 5,622 15,600 18,932 79,636 191,514
Eliminated on disposals (28) (48) (76)
Impairment 4,640 4,640
At December 31, 2012 60,700 44,795 8,739 30,954 36,277 154,184 4,640 340,289
NET BOOK VALUE
At January 1, 2012 273,150 201,818 24,992 104,832 55,664 419,407 5,258 1,085,121
At December 31, 2012 242,800 164,607 19,370 112,963 109,508 369,062 3,000 1,021,310
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 2013
12a Property, plant and equipment
2013 2012
Profit on disposal of property,plant and equipment N'000 N'000
Cost of PPE 10,558 263
Accumulated depreciation (4,980) (53)
Net book value 5,578 210
Sales proceeds 3,430
Profit on disposal of property,plant and equipment (2,148) (210)
13 Borrowings
14 Issued Capital
15
30-Sep-13 30-Sep-12
N'000 N'000
Profit after tax 79,295 455,901
Adjustments to reconcile net income to net cash provided
Depreciation of fixed assets 166,205 136,386
Loss/(profit) on disposal of fixed assets 2,148 210
Adjustment of fixed assets
Interest received (13,102) (20,623)
Interest paid 12,139 24,961
Prior year adjustment
Consolidation adjustment
Consolidation adjustment
Changes in assets and liabilities:
(Increase)/Decrease in inventories (21,947) 72,472
Decrease/(Increase) in trade and other receivables 164,086 (58,762)
(Increase)/Decrease in intangibles 1,242 32,013
(Increase)/Decrease in short term investments - -
Increase/(Decrease) in trade & other payables (108,445) 74,594
(Decrease)/Increase in gratuity provision/liability for retirement benefits (57,481) 17,419
Increase/(Decrease) in tax payable (368) (809)
Increase/(Decrease) in deferred tax -
Total adjustments 144,476 277,859
Net cash provided by operating activities 223,771 733,760
16
Bank balances and cash 164,809 427,804
Bank overdraft 670,215 302,630
835,024 730,434
CASH EQUIVALENTS
During the period, the Group spent approximately N323m on catering trucks, food and operating equipment, office
equipment and motor vehicles, assets in construction (2012: N46m on operating and office equipment, warehouse
fixtures and refrigerating systems.
The company during the period disposed of some its scrapped and fully used motor vehicles (2012 : the Company
disposed of some of its scrapped operating equipment and furnitures and fittings)
The Company obtained a medium-term bank loan in the amount of N226.5m in 2011. The loan bears interest at
variable market rates and is repayable within 2 years including a 6 month moratorium. The proceeds were used to
finance upgrade of facilities of the Company's non-smoking lounge situated at the Murtala Muhammed International
Airport, Lagos. Repayments of the bank loan amounting to N65m (2012: N126m).
Issued capital as at 30 September 2013 amounted to N317,000,000 (2012:N317,000,000)
RECONCILIATION OF PROFIT AFTER TAX TO NET CASH PROVIDED BY OPERATING
ACTIVITIES
RECONCILIATION OF CASH AND
Airline Services and Logistics Plc
Notes to the Condensed Consolidated Financial Statements
For the period ended 30 September 201330-Sep-13 30-Sep-12
N'000 N'000
17 Related party disclosures
The group has a related party relationship with its major
shareholders and directors during the year.
One of its major shareholder, Richard Tokunbo Akerele owns %
shares in ASL PLC, 100% shares in Royal African Trust Limited,
and also a director on the board of Checkport Security Nigeria
Limited.
Assets and Resource Management Limited owns % in ASL PLC
and also a major shareholder in Briscoe Properties limited.Two of
its directors ( Jumoke Ogundare and Sadiq Mohammed are also
on the board of ASL PLC
Otunba S.K Onafowokan is the chairman of Chellarams Plc and
Chairman Eskay 1st Contact Tax Consult. He is the board of ASL
PLC
Alfred Rigler is a director of LSG Sky Chefs and he is also on the
board of ASL PLC
The balances below represent amount due to related parties. The
company carried out transactions with the above named
companies that fall within the definition of related party. The
Company's management considers such transactions to be in the
normal course of business and at terms which correspond to
those conducted at an arm's length with third parties.
1 Rent & Service Charge of expatriate staff residences
Royal African Trust Limited 6,405 3,780
Briscoe Properties Ltd 11,905 14,972
2Technical Management Fee
LSG Lufthansa Services Europa 67,957 85,397
3 Catering Security Services
Checkport Security Nigeria Limited 25,880 25,986
4 Tax Consultancy Services
Eskay 1st Contact Tax Consult 18,939 12,500
Amount due to related parties
1 Royal African Trust Limited
2 Briscoe Properties Ltd 3,278
3 LSG Lufthansa Services Europa 52,910 101,633
4 Checkport Security Nigeria Limited 2,888 2,888
5 Eskay 1st Contact Tax Consult
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